Question：Loan stock and preferred shares are not popular as consideration for the equity shares of another company. Which of the following is not a reason for the unpopularity of loan stock or preferred shares?

　　A. The effect on control of the acquiring company.

　　B. The effect on the gearing level of the acquiring company.

　　C. The change in structure of the target shareholders' portfolios.

　　D. The securities potentially being less marketable than equity shares.

　　The correct answer is: The effect on control of the acquiring company.

　　There will generally be no change in the control of the acquiring company as equity shares are not being issued.